{"data":{"id":"us-ky/krs-138.165","jurisdiction":"us-ky","citation":"KRS 138.165","heading":"Contraband cigarettes -- Vending machines and motor vehicles -- Seizure -","body":"- Sale -- Remission of forfeiture -- Appeal.\n(1) It is declared to be the legislative intent of KRS 138.130 to 138.205 that any untax -\npaid cigarettes held, owned, poss essed, or in control of any person other than as\nprovided in KRS 138.130 to 138.205 are contraband and subject to seizure and\nforfeiture as set out in this section.\n(2) (a) Whenever any peace officer of this state, or any representative of the\ndepartment, finds any untax-paid cigarettes within the borders of this state in\nthe possession of any person other than a licensee authorized to possess untax-\npaid cigarettes by the provisions of KRS 138.130 to 138.205, those cigarettes\nshall be immediately seized and  stored in a depository to be selected by the\nofficer or agent.\n(b) At the time of seizure, the officer or agent shall deliver to the person in whose\ncustody the cigarettes are found a receipt for the cigarettes. The receipt shall\nstate on its face that any inquiry concerning any goods seized shall be directed\nto the commissioner of the Department of Revenue, Frankfort, Kentucky.\n(c) Immediately upon seizure, the officer or agent shall notify the commissioner\nof the department of the nature and quantity of the goods seized.\n(d) Any seized goods shall be held for a period of twenty (20) days and if after\nthat period no person has claimed the cigarettes, the commissioner shall cause\nthe same to be exposed to public sale to any person authorized to purchase\nuntax-paid cigarettes. The sale shall be on notice published pursuant to KRS\nChapter 424. All proceeds, less the cost of sale, from the sale shall be paid\ninto the Kentucky State Treasury for general fund purposes.\n(3) It is declared to be the legislative int ent that any vending machine used for\ndispensing cigarettes on which Kentucky cigarette tax has not been paid is\ncontraband and subject to seizure and forfeiture. In the event any peace officer or\nagent of the department finds any vending machine within th e borders of this state\ndispensing untax -paid cigarettes, the officer or agent shall immediately seize the\nvending machine and store the vending machine in a safe place selected by the\nofficer or agent. The officer or agent shall proceed as provided in sub section (2) of\nthis section and the commissioner of the department shall cause the vending\nmachine to be sold, and the proceeds applied, as established in subsection (2) of this\nsection.\n(4) No untax-paid cigarettes shall be transported within this state b y any person other\nthan a manufacturer or a person licensed under the provisions of KRS 138.195. It is\ndeclared to be the legislative intent that any motor vehicle used to transport any\nsuch cigarettes by other persons is contraband and subject to seizure and forfeiture.\nIf any peace officer or agent of the department finds any such motor vehicle, the\nvehicle shall be seized immediately and stored in a safe place. The peace officer or\nagent of the department shall proceed as provided in subsection (2) of th is section,\nand the commissioner of the department shall cause the motor vehicle to be sold,\nand the proceeds applied, as established in subsection (2) of this section.\n(5) (a) The owner or any person having an interest in any goods, machines, or\nvehicles seized as provided under subsections (1) to (4) of this section may\napply to the commissioner of the department for remission of the forfeiture for\ngood cause shown.\n(b) If it is shown to the satisfaction of the department that the owner was without\nfault in the possession, dispensing, or transportation of the untax -paid\ncigarettes, the department shall remit the forfeiture.\n(c) If the department determines that the possession, dispensing, or transportation\nof untax -paid cigarettes was willful or intentiona l, the department may\nnevertheless remit the forfeiture on condition that the owner pay a penalty to\nbe prescribed by the department of not more than fifty percent (50%) of the\nvalue of the property forfeited. All taxes due on untax -paid cigarettes shall be\npaid in addition to the penalty, if any.\n(6) Any party aggrieved by an order entered hereunder may appeal to the Board of Tax\nAppeals pursuant to KRS 49.220.","path":["KRS Chapter 138"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=51511","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:29Z","sha256":"b2c42abfffe7bb06e3a50da2c563b0fcb898ef3a58c66ba511d46abdc25d9fa4","source_id":"us-ky","stale":false,"prev":"us-ky/krs-138.160","next":"us-ky/krs-138.170"},"notice":"GroundRules: Original legal text. Not legal advice."}